Tuesday, September 7, 2010

Guest Post: How Can Bankruptcy Affect Your Professional Career?

Have you recently filed for bankruptcy? Then it might create impediment in the path while you are in search of new jobs. The prospective employer might ask you whether you have filed for bankruptcy or not. You need to reveal the information to your employer even if it has been years back since you have filed bankruptcy. If you choose to keep you lips sealed regarding your filing then you might be terminated on your secret being revealed. This article would help you to show how filing bankruptcy can take a toll on your professional career.

Individuals who have filed for consumer debt protection they have proved themselves financially unreliable so many business houses avoid employing bankrupts. When individuals are indebted due to joblessness they desperately look for jobs. And bankrupts are in dire need of jobs due to financial crisis. When the debtors file under chapter 7 bankruptcy their debts are discharged by the U.S Bankruptcy Court but the potential employers make it an issue to turn them down.

A legal solution through consumer debt protection is provided for debtors who are unable to manage their financial obligations. Unless the employers reconsider their stance of disappointing the bankrupts seeking for a job the situation won’t improve.

A challenging process to find job after bankruptcy:
The job seekers need to have clean credit records, no past criminal record, and negative drug tests as it would be verified by the future employers. As it would ensure them that they are hiring someone responsible for their organization.

But if your credit report displays Chapter 7 or 13 proceeding then you might not be considered eligible for the job. If you file under chapter 7 or 13 bankruptcy then it remains on your credit report for 7 to 10 years. Their financial record is ruined and that makes thing difficult while applying for a job.

If you inform the employers about your distressful situation and about the tarnished financial record before they unravel the secret. Then it might give a positive impress and they might reconsider to hire you. It might be purely based on past work performance, experience, and professional qualifications while ignoring your filing.

Law prohibits Discrimination:
U.S. Bankruptcy Code under Section 525 forbids discrimination against anyone exclusively on the basis of filing bankruptcy. The employers have the right to screen the individual if they plan to hire them. If the individuals are associated with the financial, government, high security sector then this would be a legitimate concern for the employer. If the employees go through financial doldrums then they might get in the trap of a fraud, bribery, robbery in order to come out of such financial disaster. This kind of act might hamper the interest and reputation of the company.

The future employer can reject you by showing other reasons but the reason might be on the basis of bankruptcy. But after getting the job if they terminate you on the grounds of bankruptcy then you have a right to file a case against them.

By the Fair Credit Reporting Act under Sections 604, 606, and 615 a few set of guidelines needs to be followed by the employers while evaluating your credit reports.

1. If your credit is being reviewed for job evaluation then the employers have to inform you through a letter.
2. A “pre-adverse action disclosure” should be sent by the future employer if he figures out any discrepancies on your credit report. It helps you to correct the inaccurate information on your credit reports.
3. The employer must give you an “adverse action notice” before terminating you from the service, if he traces some unpleasant information on your credit report. The contact information of the credit reporting agency providing the report should be there on the notice. If you find any inaccuracy on the report then contact the agency to solve the disparity. And demand an additional free report within 60 days from them.

A bankruptcy attorney can help you with his proficient knowledge on such cases. If you smartly deal with things then it won’t be difficult to acquire a job even after filing bankruptcy.

About the Author:
This is a guest post by Kevin Craig who is a financial writer. He has helped lots of debt burdened people with free counseling and advices on many finance related topics. If you are interested in writing a guest post, please contact PF Stock at the Email address listed in the sidebar.

Disclaimer: The information provided here is not meant as tax or bankruptcy advice. I encourages readers to consult with a bankruptcy attorney or financial adviser if they have specific questions about bankruptcy.


  1. Being bankrupt can really have an impact on your career, so that is why I wish I had clean credit!

  2. Individuals are protected from credit deterioration in economic history. They offer lower credit limits and interest rates higher, but allow you to restore their credit. The weather can have a credit card is not protected.

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  3. Clean credit record is really very essential, i guess one should be careful while making decisions

  4. I am quite interested in this topic. Hope you will elaborate more on it in future posts.....

  5. Absolutely you are correct. These are the ways bankruptcy affect our professional career...

  6. Hi! Do you still accept for guest posting?
    I'd like to write an article about financial filing for bankruptcy related articles.
    Let me know if you are interested.

  7. yes definitely its correct. But in the other ways, their are positive effect when you are filing for bankruptcy. It's up with the person if he/she file for it to save his financial problem.

  8. Bankruptcy has negative and positive effect in your life. You should considered it as a part of starting a new life.

  9. Filing for bankruptcy is you need to face the consequences, in order to start a new life. Bankruptcy is a legal procedure in which a certain person can file if they are qualified in filing for bankruptcy.